Crude Oil Joins Macro Headlines For Busy October As Stockpiles Build

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Fundamental Forecast for USOIL: Bullish

Fundamental Crude Oil Price Talking Points:

  • The ONE Thing: Crude is looking at the second week of losses after four-year highs were traded at earlier this week and massive inventory gains in the US look to show demand may be waningalongside a miss in Chinese GDP data.
  • Does two make a trend? For the second week EIA US inventories showed a surprise build of +6.49mn vs +0.909mn expected. Oil bulls hoped that last week’s mega inventory build would retrace this week after API data reported a surprise draw of -2.13mn barrels on back of last week’s report which reported the biggest build in over a year, 10mn bpd.
  • Contango is back on the prompt and 2nd-month futures contract that may show a combination of surplus inventories and waning demand, which is being blamed in part of the oil’s turn lower.
  • Per BHI, U.S. total rig count rose 4 rigs to 1067 from 1063; US Oil rigs jumps 4 rigs to 873
  • The technical picture: WTI has pulled back within a bullish channel, and

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